Real estate industry says RBI rate cut to boost housing demand by buyers

Jan 29 2013, 18:52 IST
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Real estate industry says RBI rate cut to boost housing demand by buyers Real estate industry says RBI rate cut to boost housing demand by buyers
SummaryReal estate industry and property consultants today hailed the RBI's decision.

been keen on keeping inflationary pressures under control, which had led to stringent moves from the RBI over the past nine months.

"Backed by relaxation in repo and CRR...and contained inflation, institutions are expected to offer better rate of interest on loans and may also increase deployment in infrastructure and development projects," C&W Executive MD (South Asia) Sanjay Dutt said.

CBRE South Asia Chairman and MD Anshuman Magazine said: "This reduction in the CRR and Repo rate will bring in some liquidity into the banking sector. This is a positive move and hopefully will reduce interest rates marginally, which will help the real estate industry."

The industry expects more such steps to improve liquidity and reduce interest rates to increase investments, he added.

Raheja Developers Director Manoj Goyal said with the reduction of CRR and repo rate, the developer community now expects banks to pass on the advantage to end-users.

Knight Frank India's Chairman Pranab Datta hoped today's decision is the start of a series of rate cuts to be followed over several quarters in future.

"The consequential drop in home loan rates will greatly benefit consumers and stimulate demand for new housing.

Considering the sharp drop in housing demand, a 50 basis point reduction would obviously have been more desirable and would have also sent a powerful signal towards a more facilitative environment," he added.

Assotech Managing Director Sanjeev Srivastva said the much awaited relief, although small in percentage, is going to decide the trend in the coming months.

Royal Institution of Chartered Surveyors (RICS) South Asia Advisor S Sridhar termed the RBI's action as being on expected lines and an overall sentiment-lifter.

CHD Developers Managing Director Gaurav Mittal said: "We are happy that RBI has taken cognizance of the plight of the sector by lowering CRR and repo rate. Home loans may get cheaper facilitating the buying decision of the consumers."

M3M India Director Pankaj Bansal said the developers hope that the government will, in the forthcoming Budget, will take measures such as giving infrastructure status to the sector, allowing ECB for high-end housing and increasing tax rebate on housing loans.

Ramprastha Chief Executive Officer Nikhil Jain said the move will stir more liquidity, providing a slight breather for the real-estate sector, which has started to stabilise from the toll of the inflation.

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